1. How to Fight Product
Counterfeiting with
Investigative Strategies and
Tactics
A Complimentary Webinar from Aurora WDC
12:00 Noon Eastern /// Wednesday 8 January 2014
~ featuring ~
Tim Stone
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
Derek Johnson
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2. Tim Stone has more than 40 years of experience in national
intelligence, commercial business intelligence, counterintelligence,
and information security. During his career he has created highly
successful competitive intelligence programs in several
corporations.
Tim Stone
Through his work in establishing competitive intelligence programs
companies such as Motorola, Baxter Healthcare, and Home Depot,
Mr. Stone gained practical experience in supporting the exact
issues outlined within this learning framework.
Email: stonecreek2@att.net
The Intelligence Collaborative is the online learning and networking
community powered by Aurora WDC, our clients, partners and other friends
and dedicated to exploring how to apply intelligence methods to solve realworld business problems.
Apply for a free 30-day trial membership at http://IntelCollab.com or learn
more about Aurora at http://AuroraWDC.com – see you next time!
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3. Questions, Commentary & Content
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4. Agenda
► The Counterfeiting Problem
► The Supply Chain for Counterfeiting – Parsing the
Threat
► Useful Investigative Methods to Combat
Counterfeiting
► Case Studies – what worked & what fell short
► Summary, Q&A and Discussion
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5. How Big is the Counterfeiting Problem?
► > $250 billion business globally (OECD)
► $75 billion in fraudulent medicines
► > 60% of counterfeit products sold by legitimate
companies
► FTC took action against more than 10K websites
selling counterfeit products in 2013
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6. How Do Counterfeit Products Come to Market?
► Knockoffs of top product brands
► Diverted and tampered legitimate products
► Counterfeit product components
► Substitute materials made by offshore suppliers
► Many others
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7. Combating the Problem – Expectations of Clients
► “Make it go away”
► Don’t want to talk about “internal problems”
► Who are these people?
► Stop the supply of counterfeit product
► Prosecute the counterfeiters
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8. Important Aspects of Counterfeiting Investigations
► Counterfeiters can be dangerous criminals
► Local government officials can be involved
► Identification is difficult – names change frequently;
false information plentiful
► Counterfeiting supply chains are complex and often
multi-national
► Counterfeiting cases cannot be easily stopped
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9. The Investigation
Key Steps
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10. Step 1: Parse the Threat
► Collect all available facts concerning
Prod Mfg
appearance(s) of counterfeit product
Exporter
► Identify all parties involved – “chain of custody”
Product
Synthesis
Exporter
Background checks on key outside people/orgs
Importer
► Check other markets, customers, distributors
Importer
Distributors
► Create detailed timeline for incidents
Local agent
Customers
► Synthesize supply chain for the counterfeiting
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11. Step 2: Assess the Sophistication
► Thorough product examination including materials
and process testing
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Key materials, active ingredients
Packaging
Printing and barcoding
Anti-counterfeiting measures on product
► Assess levels of technology and manufacturing
equipment required
► Identify critical sources/suppliers of equipment and
processes needed
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12. Step 3: Identify the Players
► Sales, distribution, marketing, suppliers, customers
linked to counterfeit product
► Client supply chain organization
► Customs/import/export agencies
► Government agencies and officials
► Potential vendors/suppliers to counterfeiters
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13. Step 4: Developing a Course of Action
► Team with legal counsel to develop a plan
► Background checks on key
individuals/organizations
► Contact local law enforcement & govt agencies
► Evaluate the depth of local govt and customs data –
manifests, etc
► Determine requirement for licensed private
investigation resources
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14. Step 5: Obtaining Critical Evidence
► Engage with company counsel and law enforcement
authorities to identify critical needs
► Develop full profiles of key individuals -- their
business and financial affairs, contacts, pseudos,
etc.
► Verify linkages with client supply chain, equipment,
sales and distribution activities
► Primary research – who knows what?
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15. Case Study #1: Product Diversion
Situation: Branded pharmaceutical product appears in wrong
market, looks authentic but is it?
Investigation:
Client supply chain and customer inventories examined
Customs data collected and reviewed
Samples of diverted product collected and analyzed
Background investigation of local individuals, supply companies,
pharmacies conducted; law enforcement contacted
Counterfeit supply chain synthesized
Results supplied to company counsel
Resolution:
 Source of diverted medicines terminated
Distributor agreements strengthened
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16. Case Study #2: Stolen & Modified Product
Situation: Customers of company products reporting high
rates of failure; sample products contain counterfeit parts
Investigation:
Samples of product evaluated; counterfeit components verified
Sources of all components reviewed including suppliers
Client supply chain and employees investigated
Distribution network for product examined
Results supplied to company counsel & security
Resolution:
 Supplier agreements ended
Employees removed
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17. Case Study #3: Benchmarking Anti-Counterfeiting
Measures/Technology
Situation: How quickly are other companies adopting the new
anti-counterfeiting technology?
Investigation:
Benchmark strategies and implementation steps
Monitor standards groups
Separate claims from reality
Identify issues (costs, technical difficulties, equipment etc) that
may delay implementation
Track market entry – availability of new barcoded product
Evaluate samples
Resolution:
 Cautious strategy recommended
Enhance participation on standards bodies
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18. Strengthening Investigative Resources
& Techniques
► Local presence (in country) is critical – connections!
► Deep knowledge of customs and govt. databases
► Strong relations with government
officials and law enforcement
► Access to local information bases not online
► Ability to reach “trusted” and licensed investigators
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19. Summary
► Plan carefully before proceeding
► Engage legal counsel & review applicable laws
► Work closely with local client resources in country
► Know when to engage law enforcement
► Be careful!
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20. Thank you!
Now how about a little Q&A?
Tim Stone
Email: stonecreek2@att.net
The Intelligence Collaborative is the online learning and networking
community powered by Aurora WDC, our clients, partners and other friends
and dedicated to exploring how to apply intelligence methods to solve realworld business problems.
Apply for a free 30-day trial membership at http://IntelCollab.com or learn
more about Aurora at http://AuroraWDC.com – see you next time!
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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